tv Prime News HLN October 3, 2009 6:00pm-7:00pm EDT
new jobs, protecting the environment, and strengthen american's energy security. we're going to continue to do our part to achieve these goals by investing heavily, even in the face of a down cycle, developing energy based solutions to our nation's environmental challenges. i am confident with sound and stable public policies in place that these investments hold the promise for a brighter future for not just all-american before the global community, as well. i think you for your kind attention. --i thank you. [applause] .
>> i think what i am sensing is the congress and the administration place a high priority on this because the people -- the american people place a high priority on it. they are searching for a solution that they would have confidence in that is workable. we are getting a lot of interested inquiries about our views on the carbon tax, how we would structure it, and a lot of engagements over what could we
do to the cap and trade system to address some of these issues. we have provided our views on what many people call hybrid type approaches, cap and trade with some kind of carbon fee system, for instance. we are engaged very heavily, through our own discussions, through many of the trade associations of which we are a member. we work with the number broad base organizations, the chamber, the trucking association, the farming association, and is all we can appreciate, this is an issue that will leave no american life untouched. whatever we do will change the lives of every single american in one way or another. we do feel strong and that we need to get this as right as we can. one element that is really critical is to have a system in which you have some degree of
flexibility as time goes by, so that as you are achieving or not achieving your goals, you can easily turn that not back and forth and make adjustments. a tax is fairly simple to do that, you can turn it up a little bit if you are not achieving your goals and you think the economy can stand it, or if it is coming at too great an economic cost, you can turn it down a little bit and still stay on track of emissions reductions. a cap and trade system is a very -- these are contract agreements between counterparties. it is very difficult to intrude into that system and understand exactly how you are influencing it. the way europeans do it is to put credit centex credits out. it is very hard to predict how it manifest itself in the economy. it is all about keeping it simple, transparent. i think people make good choices
when they understand the data, and the tax is pretty straightforward data. >> when oil prices go up, it seems that at the pump you recognize it pretty quickly. when oil prices go down, there seems to be a perception that you do not recognize it. is that a misperception? >> that is the market. the gasoline price that you see a core retail station is by and large a function of the competitive environment within that region. these regions can be as small as a few city blocks to as large as several counties, depending on the number of stations and about competition. the flow through up prices from the cost of the barrel of crude directly to the pump is just a function of the supply chain.
when the higher cost barrels make their way through the system, as the prices come down, it is the same thing. a lot of it has to do with how the dealer deals with those lower dealer tank wagon prices they are seeing. it should not come as a surprise to people that often as the price is rising quickly on the retail store, they simply cannot push the price through fast enough, so there is a period time when they are making no money on the way up. their margins are gone, and they are just taking the cash flow to buy the next, more expensive tank wagon of gasoline so they can change the price. on the way down, there is a natural act that occurs as they try to recoup some of their losses they incurred on the way up. if you think about the way you might run your business, you probably do the same thing. at some time they have to respond to the guy who is posting his son down the street.
-- posting his sign down the street. >> we have had a debate in our country about the need to reduce foreign oil. we are importing almost 60%. is it a false debate to worry about foreign oil coming into the country, or should we try to reduce the amount of foreign oil coming in? >> that has been a very perplexing question to me. automobile does not know where that barrel of oil came from. it burns a gallon of gasoline that was refined out of a barrel of crude from the west coast of africa as well as one from the gulf of mexico. our economy, other than the trade balance close, should not see that any differently than we do with any other trade issue. is it negative for our economy and national security to rely so much on imported sources of --
sources of foreign capital? [laughter] >> if i get 20% carried interest on it, it is ok. >> the real debate and the real issue ought to be how does that manifest itself in energy security? that is really the question people are most concerned about, is our energy security threatened because we are exposed to such a high level of imports? our response to that is, the way you manage that threat is to ensure that you have as large a number and as diverse a number of sources of imported oil as you can make available to yourself. so did not cut any sources of. the u.s. imports oil from about 35 countries. the two single largest suppliers of foreign oil or canada and mexico. saudi arabia counts for a very
small amount. the whole middle east accounts for at most, a 15%. people are fixated on that part of the world, for some reason, which baffles me, because they had been one of the most reliable sources of energy through wars and turmoil. they have always kept blowing. the only time it got cut off is when they decided to cut it off over a dispute. the question really is, let's keep this applies diversified. it speaks for open trade and maintaining good relationships among energy suppliers. they are as dependent on us as a consumer as we are upon them as a producer. that is -- there is a natural codependent secy. i understand there has been a lot made of that, and it really does perplexed me. when you look at it in the context of the fact that we have 35 countries that we can choose from. >> i don't know if you had a
chance to talk to former governor palin about industry, but on to last and issues, is there is a realistic alaska natural gas pipeline that is going to be built? >> i have said for many years this whole conversation could be much ado about nothing. there may be nothing up there. we simply do not know. the only way to find out is to go drill some exploration wells, and then we will know if we have something to argue about. if there is substantial oil there and it is a high-cost location, then it likely would be developed and produced. we really did not know what the resource endowment of anwar might be. we know it is in a fairly
limited area. there should be the right kind of geology to have reservoir traps and source rock that we could have some oil or natural gas their. if and when we get around to that is a political question. as to the alaska natural gas pipeline, i have told many people, this is the fourth or fifth time i have tried to get an alaskan natural gas pipeline moving forward. this is an extraordinarily challenging projects. the cost of the pipeline is upwards of $30 billion. it is to bring a supply of gas down to a single market in the united states. we might be able to drop some of in canada, but they really do not need it. it is a huge investment, and to make huge investments like that, i am often asked by people in alaska, i heard you were making -- i just saw were you
were making part of this project in australia. how come you cannot do this in house project in alaska? the simple answer is, they have given us 30 years of tax and royalty stability. the state of alaska has never given us tax and royalty stability. until they provide that, it is not invincible, because no one knows how much money they will make, and the state can change the tax rate on you at any given time. the state of alaska has changed our tax rate 22 times. the ratchet it up when the price of oil went high, and did not bring it down when it would low. if you are going to invest $30 billion, and it will take you 10 years to build the darn thing, and then you produce the first volume of gas to sell into a market when you know if you have no idea what the price is going to be, you would like to at
least know the state is not going to raise the tax rate on new. getting stability has been the big hurdle all the way along. we have spent a lot of time talking to them about it. we want it as badly as they do, because we want to see this resource brought on the market for consumers in the united states. >> for our guests who might have some extra money to invest in the stock market or elsewhere, if they wanted to invest in energy world, other than your stock, where would you say that could make a good profit investing in energy? what areas do you recommend? >> david, that is why i just run an oil company and not an investment house. >> before you became ceo, the exxon valdez was a national problem when it had this bill.
what has exxon and other oil companies done to prevent that type of problem occurring in the future? >> the bell says -- the exxon valdez was an extraordinarily emotional event inside of exxon. what it motivated us to do was to completely change the way we deal with risk management. our that incidents -- out of that incident was an extraordinary effort to create what is called our operational integrity management system. at the time it was called something else, but it has evolved over the last 20 years. is a very detailed approach to how we manage all elements of risk in our business the world over. it is done the same way, no matter where you are. the benefit has been that as we moved people around the world from place to place or we go
into any place, we take this system with us and do not have to create something from scratch. our people did not have to wonder how we will manage risk will we go from one part of the world to another. the execution of that system is what has changed. we have not had for about 10 years, our average marine spill is a teaspoon for peake -- per million gallons of what we transport. these are little drops that come off the whole we disconnect. it has changed dramatically the way we manage that risk. that has been picked up throughout the industry, and has changed dramatically. technology has helped as. better materials, the fleet is being changed out to double hulled tankers, which gives you another barrier.
you do not want that to be your only protection. you had better have some very good systems in place as well. it was a lesson that was hard learned by us and the industry as a whole. it is one that we look back on and remind ourselves of all the time. >> when you were competing against foreign companies around the world, is the foreign corrupt practices act a real handicap for you and american companies, or is it something that is not a handicap any longer? >> let me think about how to answer this question exactly. it is irrelevant to us, because the foreign corrupt practices act is the law, and we abide by the law. if you are in a situation, and we are in these situations all the time in dealing with foreign governments, where as a condition of the deal, they
introduced some aspect that they say to get the deal done, now you need to do this and this. quite frankly, we just say at that point, we cannot do those things and we are not going to do those things. that is the basis of the deal, then exxonmobil in your country can i do business, and we just have to get up and walk away. we do that more often than people probably realize. the interesting part of the rest of the story is that more often than people realize, as time goes by, the government calls us back and ask why we have not come back to see them. we say we told you cannot do the deal under those terms. they say we need to come back and talk to them. we pick up the conversation, and those questions are never asked us again. because it is not illegal for companies from certain countries to engage in certain activities, the government just want to ensure they are getting everything they can get. when they understand we cannot do that, if the deal is sound
i am wondering if you could comment on the specific impact that will have on you, and what that might do to the price to the it -- to the price of a gallon of gasoline. >> i have not had a chance to read in detail the carry-boxer bill. i know some of the basics of what is in the bill. in terms of the impact of any type of legislation on our business, we already evaluate our investment decisions going forward -- we have for some time included an assumed cost of carbon in all our investments, working on the basis that we think legislation is going to move forward. our investments have to bear the cost of that. i am not going to share with that assumption is, but we do have it in their. clearly, some certain types of
projects are made -- are put at the margin. what that sends us to do is send our technologist back to the drawing board and say if this is the element that is putting it beneath our investment criteria, you have to go find a way to improve that situation. you have to figure out how to get cost out of it somewhere else, on some technology solutions, but if we are going to invest in this project, you have to give me a better plan than you have now. that is no different than the way we deal with any other risk element of projects. this is just another element of risk that we manage when we make investment decisions. it does not fundamentally change the way we do things. there is no doubt there will be some things that the margin that will no longer be economic, unless our folks can figure out a way to call the value back. we are pretty good at doing that. in terms of what it would mean for the price at the pump, that
is a function of where they set the price of carbon. it is hard to say what the effect would be until you know what the current price is. >> we have not build a refinery in this country in decades. is it possible to get a refinery built here, or is it not worth pursuing any longer? >> the real question is do we need any more refineries? the last refinery bill was in 1973 by marathon. we built the next to last one in joliet, illinois in 1972. we were talking about this over dinner. what a lot of people do not appreciate is that while there have been no new greenfield sites built, within the fence lines of the existing refinery system, there has been enormous modernization, upgrades, and improvements over the years. that is why we have been able to read the rising -- meet the
rising demand without any new refineries. the last one was built to refine at a capacity of 160,000 barrels a day. j that same refinery processes almost 280,000 barrels a day. that is just a technology improvements and engineering and science and things we learned how to do to get more out of it. the question is do we need any more? the answer to that is, we think likely not. gasoline in the united states peaked in 2007. we have had an economic correction, but before that i work out look -- our outlook currently is that in 2020, we will be using about 17,000.
that is a result of several things happening. ethanol and biodiesel and things that are out there taking up some of the demand space, but there is an enormous improvement in energy efficiency in the fleet. the motor vehicle fleet has been improving at 1.5% per year over the last 25 years. they are rich fuel economy line has stayed flat. the reason is because the automobile industry has taken all the energy improvement in the fleet and plow it back into heavier vehicles and more horsepower, because that is what consumers want. the advent of the suv. we think going forward at that because of the emphasis on energy efficiency, ongoing improvements in vehicle mileage standards, as well as the changing mix over time of higher
bid vehicles -- hybrid vehicles, that motor gasoline demand is down. we probably have plenty of refining capacity. >> when you are driving along and stop to get gasoline and you stop at an exxon station, do you ever tell them who you are? do they recognize you? >> i do not want to give them a heart attack. i have learned that as soon as i walked in, and occasionally a store manager in the stores we own will recognize me. i see them immediately run to the bathroom to see if it is clean. [laughter] >> [inaudible] >> opec has had a curtailment in
place for about a year and a half. compliance with that curtailment has been extraordinarily good. at one point that had 82% compliance, which is very good for opec. it is running about 65% now. some people just cannot help themselves when the price gets above 70. opec as an entity continues to play the role they want to play. they have continued to invest in capacity, so back to the concern people have over foreign imported oils. saudi arabia has invested billions of dollars to increase their capacity to a little over 12.5 million barrels a day. they did that so that the world will have reliable supplies and so that they can take advantage of the demand when it is there. they are sitting on almost 4
million barrels of shut in spare. i did not note that many people in the business community who can invest that kind of money and then shut the capacity in. that play a useful role. there is somewhere between 6 million barrels a day of spare capacity that is shut in. inventory levels are at record highs around the world for crude oil supplies, for motor gasoline, for heating oil. there is more than 110 million barrels of oil floating with no place to go. so there is a huge supply overhang out there. from opec's perspective, they have invested a lot of money and they would like to be able to sell cut some of the capacity they have invested. in terms of whether there relevant today, of course they are.
>> coming up next, a look at the performers' royalties act which would require commercial radio stations to play repair world teaches music performers. later, a panel discussion on the impact justice sotomayor could have on the supreme court. tomorrow on "washington journal," a look at the latest developments in iran and afghanistan. more on afghanistan with a presidential historian and author, and a foreign weapons inspector on iran's nuclear program. this week on "newsmakers," california senator barbara boxer talks about the role of
the epa and congress in dealing with climate change. >> i expect people to go and try to repeal the endangered species act and the safe drinking water act and the clean water act. this is just an excuse for them to come in. i think the epa is doing what they have to do under the law. there is a danger to global warming. guess who said that? the bush administration. all the scientists and the american academy of scientists, so epa stepped up to the plate and resolve it now. we can resolve it in two ways. one is to let the epa do there were, and i support that, but i think is foolish not to do it our way, which gives much more flexibility, the ability to buy of sets, the ability to really create jobs and do the kinds of
things that we want to do. >> see the full interview with senator barbara boxer this sunday at 10:00 a.m. and 6:00 p.m. eastern. >> justice o'connor insisted that we have lunch every day when we were sitting. now, clarence, you should come to lunch. she is really sweet, but very persistent. i came to lunch, and it is one of the best things i did. it is hard to be angry and bitter at someone and break bread and look them in the eye. it is a fine lunch, and very little work is done there. it is just nine people, eight people, whoever shows up, having a wonderful lunch, and is wonderful. >> hear from all the supreme court justices about the history and tradition of the court. see inside this historic and beautiful building, to place is only available to the justices
and their staff. watch c-span is feature documentary, the supreme court. all starts sunday at 9:00 p.m. eastern. for a special preview of our conversations with the justices, join us sunday at 8:00 p.m. eastern for "q&a". this week on "the communicators ," to perspectives that would require real stations to pay royalties to performers of music. we will hear from representatives from both the radio and entertainment industries. >> as chairman of the national association of broadcasters and president and ceo of commonwealth broadcasting corporation in kentucky, steve newberry runs a radio station group that runs several radio stations in kentucky. he is with us this week to talk about the performance rights act. how you define the performance
rights act, and what is your position on it? >> there is a bill before congress that would charge ready of stations a fee to play the music that historically we have compensated the artist or the performers by promotional value. this would actually a sign of monetary value to that, and our industry has significant concerns about that and strongly opposes that legislation. >> what with the monetary value be? >> is unknown. currently we provide compensation to composers to the tune of half a billion dollars a year. we provide compensation in a monetary form to composers because they do not have the benefit of celebrity. they are not able to go out and
monetize the celebrity. geoffrey steele is a great guy who writes all kinds of songs that you know, but you do not recognize the name. if i say rascal flats are montgomery ginger, you know those names because he writes their music. we provide a promotional compensation or consideration to the artist albums or cds and get celebrity endorsements. it is generally a flat fee per station. it is divided among three licensing groups, and then they have their methods that they disburse the money. >> what about the performers who said that this is a fairness issue? >> i understand how performers feel. they have been dealing with
contracts with record labels that were not advantageous to them. many times the artist created a tremendous amount of value to the recording industry for the record labels, but they come out of their celebrity without much money in their pockets. that is one of the issues we have the most concerned with. broadcasters have held our into the deal, but the record labels are the ones that over 50% of the money would actually go to. >> who started the performance rights act? >> the business model has dramatically changed as a result of the digital revolution. they used to sell you an album for $15 the cost of about $1 to distribute and manufacture. for many of the younger generation, they just take copies from one another's ipod or computer. even if they do download from
itunes or somewhere else, they are getting pennies on the dollar compared to what they used to get. >> as a radio station owner, do you think performers should pay you to play their record? >> i think we have a relationship that has worked very well for 80 years, but certainly since pop music exploded back in the 1950's. we have certainly value the relationship we have had with performers. we have helped create a lot of celebrity for those folks. we are not asking for compensation. we don't think music should go to the highest bidder, but we do see this happen. radio stations are forced to pay. one of the unintended consequences could be that it becomes a pure business transaction. radius stations are forced to either -- radio stations will be
much less willing to take a risk on a new our young artists, and will play those who have the most consistent performance recognition. you could see the new artist taking it on the chin for this. >> if this act should past, and john conyers is supportive of it, if it should pass, what would be the immediate effect in your business? >> we are seeing one of the most work -- one of the worst economic times of the decade. there would be job losses and a curtailment of services. the radio broadcast industry is a fixed cost business. my electric bill is not going to decrease just because i have to pay more to the performers. the fees that i paid to that fcc are not going to decrease. the only opportunity we have is to look at our employee and
community service expenses, the variable costs that we have control over. long term, it would change the business model and the relationship between radio stations and record labels in a way that will be detrimental to the listeners. that is what is most concerning to us. >> are there any bills out there that supports your position? >> we do have a resolution, and we have 247 co-sponsors for in house. they have sided with the broadcasters on this issue. we have companion legislation on the senate side. the dynamic on the senate is much different. they are less hesitant to co- sponsor legislation. >> if you are sitting on 247 friends right now, this is a dead issue. >> i would never be so arrogant
or overconfidence is safe it is over. i would not trade places with my opponent right now, but they are very determined, and i expect that they will continue to bang the drum to pass it to the house judiciary committee. when it comes to the four boats, we think we have communicated read -- when it comes to the floor of votes. >> this is a quote from judy collins. "radio it is a multibillion- dollar business created on our creativity and our soul." colleagues say they must tore into their golden years because they never got paid for all the radio playe the receipt. >> it is a shame that the judy collins of the world had such bad record label deals that they did not seek the fruits of their labor, but it is not radio's
fault. we know who judy collins is because her is it was played on the radio. i am sorry she is having to work into her golden years, but the record labels have taken advantage of relationships with the artists. >> music is part of the mix of a radio station, but we have lots of talk stations, sports stations, local news, community involvement. we are proud of the relationship we have had with the performers and playing the music over these years. >> satellite radio pays a royalty. why not commercial? >> satellite radio also charges subscription fees. local radio is free. if you want to subscribe to an internet station, that is certainly someone's preference and they have that additional
income stream. the number of people who subscribe are less than 20 million. it pales in comparison to the 235 million who listen to free local radio over the air every week. the promotional value of a song being played on xm has no where near the commercial value on local radio. >> my 11-year-old son has a variety of listing choices. serving local communities, not
being a generic product it tries to reach listeners in 50 states, but being a local station that focuses on certain towns, that is what we are most proud of. we are sensitive to the fact that people can get music from a lot of different sources. digital downloads. >> tell us a little bit about commonwealth broadcasting. >> it is a group of 24 stations based in kentucky. we operate in four regions. we have folks who make those decisions in terms of what the programming is and what we serve in our communities. they have that autonomy. if the regional manager says we need to go from country to adult contemporary, that is the recommendation we follow.
it is just like public library or local bank. we are there to make sure we have a partnership. >> is it all at them or a.m.? >> it is a mix of everything. programming lies, we have everything from espn sports to country, to rot, to top 40, to adult contemporary. we do what the community finds the most appealing is expensive to carry espn radio? >> because of the relationship we have this with the network, they have enabled us to affiliate on an affordable basis. one of the other issues that if the performers' rights deep passes, a lot of stations will move from music formats to more talk formats for the reason that if the fees go up, i pay
significantly less for might espn programming costs and what i pay for their composers on the same radio stations. i have other obligations with espn. is a partnership that i am proud of and we work through closely with. broadcasters will say wait a second, do not want to keep paying these fees for all these music stations, or do i decrease the number of music stations i have? ultimately that will cause problems for the entire artistic community. the composers will see less money because there will be less airplay. that will have a negative effect on evolving artists. the basic return on investment is, if i am paying you, i have to make sure that every song i play is worth the investment i am making. now because of the artistic balance, i can take a chance on a local band. we have local group coming from
my home town, belasco, ky. -- glasgow, ky. >> what is the future of age the radio? >> it is a technology -- hd radio has tremendous value for the listener. it enables radio stations to offer an additional menu of services. there are lots of different dynamic effects that go with it. we have one station and are in the process of building other stations. the economy has stymied it, and that is a challenge our industry has right now. it is hard to make any plan on capital investments when you see the entire economy as it is
right now. >> what are some of the other legislative issues you are facing? >> the performance rights bill we have been discussing is the predominant issue for the radio broadcasters. for the television broadcasters, we have significant issues in making sure that the local franchise, the abc or nbc affiliate', that that is protected for our local broadcasters in terms of penetration from the satellite companies that might be importing signals into the market, making sure the relationship between cable companies and broadcasters are equitable. if you look at the viewing patterns on most every cable system in the nation, clearly the local affiliates or what drive significant revenue. when you see what local
broadcasters do for the revenue and for the subscription base of the cable companies, we want to make sure the relationship stays balance. >> with the changing media that people have available, are there rules in place that you think should be changed with regard to radio and tv and newspapers? may be working together for joint ownership? >> we are in an evolving regulatory and economic model right now. for me to sit here and say that they are perfect, no. or the catastrophic, know. what was appropriate in 1997 or 1999 is going to be different than in 2007 or 2009, or in 2017 or 2019. we have to constantly adjust it. the levels of competition are immense. if you go back to their original content of a lot of the
regulations, there were limited to amounts of voices in the community. there were only so many television or radio stations or newspapers. my son has the ability to log on to the computer and find information from anywhere around the world because we have broadband service. the other thing that is important for our association is, we have to move toward looking to the future, not just protecting the status quo. we have to make sure the playing field 20 years from now continues to create a vibrant broadcasting community. we have to always be looking at how the regulations can be shaved to keep everybody healthy. i have always had a great experience with the fcc. i have not always agree with their policy positions, but the commission has been
extraordinarily helpful whenever i have had a regulatory issue. we have had a terrific working relationship with the various members of the commission. we may disagree on positions our policies, but they are helpful to our industry. >> we have been talking about the performance rights act. are you a fan of the four tops? >> i am a fan of the four tops. i understand that your next guest invested a lot of time. it is a case of where his group is paying an unfortunate price today. >> here is our interview with one of the original foretops, who has a different position on the performance rights act. how did you get involved in the big issue of performers royalties? >> i have had a feeling for
this one a first that are hit record in 1964 at motown. i noticed there were getting these extra checks every three months. i said wait a minute. what you keep getting these checks? he said it is for radio play. i said when this hours come in? >> he said it is just for people who wrote the song. i said it is intellectual property. >> he said it was not like that. i wanted to get people to put up some kind of protest or work toward getting that done, but nobody was really interested. i noticed people like frank sinatra tried. when i heard there was a major push in the performance right act becoming an outstanding bill, i was talking some people who were very close to music first.
they said you really ought to call them and let them know how you feel about this. people would believe you because it is coming from the heart. the way you talk about it, it shows a lot of justification for the bill. >> what is the music first coalition? >> is a coalition of all music companies and people connected with music and entertainment. what is so exciting about this year, finally we see an open window. this has been going on for 80 years, trying to get this bill. the bill of that exists is 100 years old.
it was instituted in 1909, and it was just for piano music and the ones eroded -- the ones who wrote it. when they made it, they notice the bill did not require payment for the performers. performers meaning the people that sing on records, the musicians, and background. that never happened, and it just kept on, and that nab has always been very strong. satellite radio pays performance rights.
internet radio pays performance rights, and cable. >> how do they come to the place for they are paying you? >> when it was brought to them by music first, or either it could be [unintelligible] the realize this is justification. a lot of them did not even argue. advertisers pay the bill, we all know that. music draws people to the radio. tombaugh's, too, but a lot of it is music. -- talk does, too, but a lot of it is music. these people are the ones to hear the advertisements. they spend $16 billion last year, because of the way the song is delivered, not the actual song. if you just play a song on the piano, it is not live.
when the for talkur tops sang " bernadette," that was real. right now there is a lot of misleading information, and actually some lies about this deal. the board hearing the negative. they are hearing is a tax, which is not -- people are hearing the negative. we cannot tell our side of the story on the radio. they will not let us advertise. the only way we can tell our side is through town hall meetings and press ads.
until people your the true story, it is not going to hurt black, urban, gospel, are small radio. some of those small stations will not have to pay anything. the next tier would only pay $1,000 a year. the next tier, probably seven daughters and son of radio would pay -- it probably would pay $2,500 to $5,000. what annoys me is, we have always been radio friendly. any kind of radio, and we have always worked together and help each other. when this deal was brought forth by john conyers, they just went on the defensive. they did not sit down with us.
let's talk about it. how can you make it so -- we would have talked about it, and we still will. they do not want to come to the table. it is neither here nor there. it becomes large when you look at it globally. america is one of five countries that do not pay the artists. every other country in the world except china, iran, north korea, rwanda, and our country. all these other countries that listen to american music, they pay their performers. what they would be paying
american performers, they put in an escrow account and they hold it there for a while. that is worth up to $100 million a year that would be coming in globally, taxable money, money that a lot of older artist who cannot travel. >> how much money do you think your group has missed out on? >> tons of money, and i am not fighting for that. when i travel, i see some people who cannot work and cannot pay hospital bills. these are artists and do not even have insurance to pay for their funerals. and their records are being played. advertising drs. -- advertising dollars are being spent. there is no justification for
not paying. >> you talked about relationships between artists and radio stations. radio stations might say look, we are playing the song. that is advertising for your group. >> they say that, but every time they play our records, our company had to buy advertisements. we had to do conserves. we did not talk about that, because we scratch each other's back. nowadays, it does not matter. our records pretty much have sold what they are going to sell. they are saying that because they are the only ones they can get to the people by radio. we always scratch each other's backs. radio has never done that. for the community, they do, and i am not talking about that. the company has to buy
advertisements. we will always work with them. they just come to us now and say, why don't you do a commercial for this company and just do not take the money. we will take care of their royalty fee. it is just an injustice, and it is time for it to happen. every other format is doing it except terrestrial radio. there is a three-year moratorium because of this depressed economy. it would not kick in the day it was voted. it is moving positively through the house. it passed the judiciary committee.
when fall comes, we have to go and work on the senate. >> one argument i have heard is, the record companies get the money, in part that goes into their companies before it goes to your pocket. >> any thing we are talking about is intellectual property. who owns the tracks? that is what they call the record company. whoever owns the tracks gets 50% of the royalty split. the artist and musician get the other 45% 5% goes to property administration. the companies on the tracks. a lot of artists on all the tracks, so it would go to whoever owns the tracks. we get our royalties of of sales. we made a contract with motown records, and we get royalties from the sales.
we have royalties in perpetuity. there are a lot of people that do not sell. >> if this is approved by the senate, it is a three-year moratorium. could you give an example of what kind of royalty and new performer might get? >> i do not have a clue. eventually, i will find out. they have formula. you are talking about $5,000 a year been divided among 2000 songs. it has not been totally negotiated for the real major companies. they have not come to the table. we are not going to just t